> Gigerenzer is undoubtedly correct that Bayesian reasoning is something that can be learned by many people, and yet all that Kahnemann needs for the implications of his statement that "the human mind is not Bayesian at all" to be relevant in behavioural economics terms is for some portion of the population to reach systematically different conclusions from the correct Bayesian one using an inferior heuristic. (A point Gigerenzer essentially demonstrates by citing a study which show how outcomes improved after gynecologists already motivated to make correct predictions were taught Bayesian reasoning). Perhaps it's sloppy wording on the part of Kahnemann that Gigerenzer is taking exception to, but the core claim is not that humans cannot learn statistics, but that at a population level, some humans will continue to rely on less accurate heuristics which deviate from those predicted by rational expectations models in a systematic [and predictable] manner which are not simply eliminated over time due to financial incentives to be correct.
Indeed, the possible result that only some people are irrational would be very good for the paternalistic policy makers. In fact it would be better than the result that all people are irrational; if all people are irrational, what gives some irrational people the right to guide other irrational people’s lives.
Economists are always oh-so-sorry to inform us that some people just can’t run their own lives without the help of the “free” market or the government. So very sorry. Happily they know some technocrats that will bravely shoulder the burden of being Bayesians.
Indeed, the possible result that only some people are irrational would be very good for the paternalistic policy makers. In fact it would be better than the result that all people are irrational; if all people are irrational, what gives some irrational people the right to guide other irrational people’s lives.
Economists are always oh-so-sorry to inform us that some people just can’t run their own lives without the help of the “free” market or the government. So very sorry. Happily they know some technocrats that will bravely shoulder the burden of being Bayesians.